Exactly. Scalping exists because the ticket prices are lower than the marginal utility to the fan. Raise ticket prices, and there will be less scalping.
The issue is that production is inelastic compared to demand, so scalping provides no additional value and creates higher prices by making demand seem even higher.
Except they're only paying extra because, ta-da!, the tickets were scalped. The competition is higher at the lower price because, ta-da!, the tickets were scalped.
The arguments for scalping only work if the effects of the scalping are ignored. Eliminating scalpers benefits everyone.
I like the idea of demand pricing as a way of increasing access but I don’t think it would work in practice.
Too many people would be thrown off by the falling price, and want to wait. Friends who bought earlier than other friends feel like suckers for spending more money on the same thing.
Lastly, what we call scalping _is_ a service to the ticket-buyer. The scalper is providing a market for the ticket at a price which is agreeable to the buyer. Dads love to complain about the “high” price of a ticket while they stand in line for $15 popcorn. Meanwhile, scalpers effectively do the work described in the article by adjusting prices very quickly based on actual demand. As an event gets close to starting, unsold inventory drops precipitously in price until it’s sold.
The reason scalping has a bad reputation is that most entertainment pricing is set well below the actual value of the event.
Except that scalpers are also a part of the market. When a large percentage of original purchases are by scalpers, they artificially up the market value.
Scalpers aren't powerful enough to create an artificial scarcity. If there were not really an increased demand for the products, noone would pay their inflated prices. When demand outstrips supply, the logical thing for manufacturers and (e-)retailers to do would be to increase prices themselves to balance out the situation, but for various reasons (one of which is possible negative PR) they are reluctant to do that, so the scalpers profit...
Scalping only exists because the product is sold below the market’s clearing price. Raise the price and you’ll take the air out of the room for scalpers to exist.
EDIT: remove unnecessary scare quotes left from unpublished draft
They could only do that by cornering the market, but if there are many competitive scalpers, then the price is right and that's just normal supply (at the source supplier, not the scalper) and demand.
I mean, the enabling principle behind scalping is that demand is more than supply but supply does not increase to match. More people want the tickets than there are tickets, scalping means it's based on cost instead of who you know or how much time you're willing to spend or how lucky you get.
This doesn't just solve scalping, this fixes the lack of supply of tickets which allows scalping to exist
edit: I'm not sure I completely stand by this. There are various good reasons to sell tickets for cheaper than the maximum price you could and still sell out. Still, it's a harder problem to solve than it looks
This sounds like ticket prices are finally matching demand. The existence of scalpers is direct evidence that ticket prices were too low - demand for low price tickets exceeded supply. Ticket prices just high enough to undersell probably indicates that we've reached close to equilibrium prices.
Scalping is just arbitrage. The core issue is that the retail price of the tickets is lower than the market price, which is probably high because the supply is limited (and probably artificially so by Ticketmaster et al).
I think scalping is more of a supply issue, raising the official price of the product would only require more cash when scalpers are doing their buying.
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